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Blackstone has agreed to acquire Home Partners of America, the buyer and operator of single-family residential rental properties for US$6 billion, indicating that the world’s largest real estate management company is confident that the prosperity of the US real estate market will continue.
The real estate division of this private equity firm has real estate assets worth 378 billion U.S. dollars and will add more than 17,000 homes to its portfolio in the United States. HPA will become part of Blackstone Real Estate Income Trust, a permanent capital tool that Blackstone manages for income-focused investors. *
HPA co-founder and CEO Bill Young said: “This partnership with Blackstone Real Estate and its consistent support for our business will ensure that we are in a good position to expand the scope of our program and provide more housing. “
During the pandemic, U.S. housing demand surged as millions of Americans seeking larger homes away from the city center used record low interest rates and government stimulus to purchase new properties. As demand often exceeds supply, this leads to sharp price increases.
According to data released by the National Association of Realtors on Tuesday, the median price of existing homes in the United States hit a record high of $350,300 in May, an increase of 23.6% from the same month last year.
Blackstone is considered one of the most savvy real estate companies, and its decision to purchase HPA will make people feel gratified that despite recent signs that supply is catching up with demand, demand for new homes will remain strong. Compared with the same period in May, home sales in early June increased by 6.7%.
After the financial crisis, Blackstone established Invitation Homes, combining some of its assets with those owned by troubled competitors to become the main landlord in the United States.
Invitation Homes became the largest single-family home owner in the United States after purchasing tens of thousands of houses during the foreclosure crisis. It went public in 2017, and Blackstone withdrew its shares in the company two years later.
The New York company re-entered the market in 2020 with a $300 million investment in Tricon Residential, a Canadian rental housing company with more than 31,000 houses.
Blackstone’s entry into the real estate market has met with some criticism. In the 2019 Housing Report, the United Nations accused the organization of “driving low-income earners and more and more middle-income earners from their homes,” while Democratic Senator Elizabeth Warren from Massachusetts accused the organization of “shamelessly” Profit from housing. The real estate crisis.
The company insists that its investment stabilizes the real estate market and creates jobs.
*This story has been updated to correct the reference to Blackstone Perpetual Capital Instruments.
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